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The founder of Sifted, an FT-backed site covering European start-ups, discusses Europe’s challenge in maintaining technological sovereignty.
The French financier, Philippe Tibi, describes Europe’s struggle to compete in the global geotechnological race. He emphasizes the need for Europe to invest in critical industries, such as batteries and semiconductors, on a much larger scale. Tibi aims to mobilize growth capital across Europe to achieve this goal.
In collaboration with the French government, Tibi convinced 23 leading institutional investors to commit €6bn of late-stage funding to the tech sector. This successful initiative has prompted the launch of “Tibi 2,” which aims to attract an additional €7bn of institutional money into early-stage, deeptech, and cleantech investments over the next four years. The UK has shown interest in replicating the Tibi initiative to address its own shortage of growth capital.
Despite having abundant capital, Europe lacks the intent to invest in growth capital. Most institutional investors in Europe are risk-averse and prefer more conservative investments. Private market investments, like those in the tech sector, are often considered riskier and less liquid. Additionally, the absence of a tech-friendly, pan-European stock market limits the appeal of investing in European tech companies.
Tibi’s initiative has attracted first-time investors into the late-stage tech sector in France. However, the recent tech downturn has made fund managers cautious about investing in tech startups. Despite this, Europe has a thriving ecosystem of early-stage start-ups and is attracting interest from top US VC funds.
It’s time for European institutions to step up and support the region’s technological future, rather than relying on foreign investors.
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